China cuts bank reserve requirement ratio to free up funding

BEIJING (AP) — China says it will cut the amount of money most banks are required to keep on hand to free up funding for small businesses, amid a brewing trade war with the United States

The central bank said the cut of 50 basis points, or half a percentage point, in the reserve requirement ratios will take effect on July 5. The move will release about 700 billion yuan ($108 billion) for use.

On July 6, the United States is set to slap tariffs on $34 billion in Chinese goods to punish Beijing for its attempts to supplant U.S. technological dominance.

Beijing has vowed to retaliate, and Trump has threatened additional tariffs that could eventually cover $450 billion in Chinese products.